Condor Announces 2017 Third Quarter Results

November 14, 2017 by The Canadian Press

FOR: CONDOR PETROLEUM INC.TSX Symbol: CPI

Date issue: November 14, 2017Time in: 6:35 PM e

Attention:

CALGARY, AB --(Marketwired - November 14, 2017) - Condor Petroleum Inc.
("Condor" or the "Company") (TSX: CPI), a Canadian based oil and gas company
focused on exploration and production activities in Turkey and Kazakhstan, is
pleased to announce the release of its unaudited interim condensed
consolidated financial statements for the three and nine months ended
September 30, 2017, together with the related management's discussion and
analysis. These documents will be made available under Condor's profile on
SEDAR at www.sedar.com and on the Condor website at www.condorpetroleum.com.
All financial amounts in this news release are presented in Canadian dollars,
unless otherwise stated.

Q3 2017 Highlights

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-- Construction of the Poyraz Ridge gas processing facility in Turkey has

been completed. Pre-commissioning activities have successfully been
performed, introducing gas to the various processing components.
-- Construction of the 16 km Poyraz Ridge sales gas pipeline has also been
completed and is undergoing acceptance testing. Commercial production
with initial rates targeting 10 MMscf/day is expected to commence in the
fourth quarter of 2017.
-- The Poyraz 3 and Poyraz West 4 development wells in Turkey have been
completed and tied into the processing facilities.
-- The Yakamoz 1 exploration well in Turkey was drilled to a total depth of
2,250 meters encountering numerous gas shows while drilling. Though the
well was abandoned without testing, post-well remapping of the Yakamoz
prospect indicates the well was drilled off-structure and side-tracking
alternatives are being evaluated.
-- Production from Shoba and Taskuduk in Kazakhstan averaged 457 bopd for
the three months and 410 bopd for the nine months ended September 30,
2017 and the operating netback which is defined as crude oil sales
revenue less production costs, royalty expense and transportation and
selling expense, averaged $19.79 per barrel in the third quarter of 2017
and $18.47 per barrel for the nine months ended September 30, 2017.
-- The Company has referred the Zharkamys exploration contract extension
case to the Supreme Court of Kazakhstan and the hearing is scheduled to
commence on November 29, 2017. The on-going court proceedings related to
Zharkamys do not affect the Company's Shoba and Taskuduk oilfields which
are each governed by separate production contracts.
-- During the first quarter of 2017, the Company established and received
funds from a USD 10.0 million secured non-revolving credit facility
which bears interest at 14% and matures on January 31, 2020 and issued
to the lender a warrant certificate exercisable into one million common
shares of Condor at $2.35 per share on or before January 31, 2020.
-- The Company recorded net loss of $2.5 million for the three months ended
September 30, 2017 (2016: $1.7 million) and $66.5 million for the nine
months ended September 30, 2017 (2016: $8.7 million) which includes
$56.6 million of exploration and evaluation expense pertaining to the
derecognition of the Zharkamys contract in the first quarter of 2017.

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Operations

The Shoba and Taskuduk oilfields in Kazakhstan produced 42,059 barrels of oil
or an average of 457 bopd for the three months ended September 30, 2017 and
111,806 barrels of oil or an average of 410 bopd for the nine months ended
September 30, 2017. For the three and nine months ended September 30, 2016 the
Company produced 5,903 barrels of oil or an average of 64 bopd. Production
increased as there was no production in 2016 until mid-September when
production resumed at Shoba following the signing of the Shoba production
contract.

In Turkey, construction of the Poyraz Ridge gas processing facility is
complete. Construction of the 6" sales gas pipeline is also complete after
receiving approvals for all the surface right-of-way access rights. Production
is expected to commence in the fourth quarter of 2017 at an initial rate of 10
MMscf/day following formal commissioning of the facility and the pipeline and
obtaining the customary government approvals.

The Poyraz 3 and Poyraz West 4 development wells in Turkey have been completed
and tied into the processing facilities.

The Yakamoz 1 exploration well in Turkey was drilled to a total depth of 2,250
meters to test a "new" sub thrust-fold play type located 2 km from the Poyraz
Ridge gas field. The well confirmed that an active petroleum system extends to
the north and west of Poyraz Ridge and, as predicted, numerous gas shows
proved an extensive fracture system prevails along the Miocene-Eocene
sub-thrust trend. Though Yakamoz 1 was abandoned without testing, the well
provided critical structural and stratigraphic information that can be tied
back to the regional 2D seismic as it relates to trap, reservoir and seal
within this fairway. Based on the new velocity-depth information, re-mapping
of the Yakamoz prospect concluded the well was drilled off-structure. Condor
is currently integrating this data into a revised geological model with a view
to side-tracking the Yakamoz 1 well in addition to high grading prospective
areas for future 3D seismic and additional exploration drilling along and
sub-parallel to this trend.

The net loss for the nine months ended September 30, 2017 of $66.5 million
(2016: $8.7 million) includes $56.6 million of exploration and evaluation
expense pertaining to the derecognition of the Zharkamys contract in the first
quarter of 2017 and $1.6 million of exploration and evaluation expense related
to the Yakamoz 1 well. Cash used in operations amounted to $1.5 million for
the three months ended September 30, 2017 compared to $2.7 million in the
third quarter of 2016. Capital expenditures for the three months ended
September 30, 2017 amounted to $2.8 million (2016: $6.6 million) and for both
periods relates mainly to Poyraz Ridge field development in Turkey.

Zharkamys exploration contract

The Company's Zharkamys exploration contract ("Zharkamys Contract") with the
Ministry of Energy of the Government of Kazakhstan ("Ministry") was due to
expire on December 14, 2016. Prior to this date, the Kazakhstan Chamber of
International Commerce and subsequently the Kazakhstan Civil Court ("Civil
Court") confirmed that a force majeure event had occurred which, under
Kazakhstan subsurface use law, can be the basis for the Zharkamys Contract
validity period to be extended for a period of 630 days. In May 2017, the
Kazakhstan Court of Appeal ("Court of Appeal"), pursuant to an appeal filed by
the Ministry, released its ruling dated April 14, 2017 that the force majeure
event is not recognized and reversed the decision of the Civil Court. As a
result of the Court of Appeal ruling, there is uncertainty regarding the
Company's future legal rights to have the Zharkamys Contract extended and the
related exploration and evaluation assets were derecognized.

The Company has referred the case to the Supreme Court of Kazakhstan ("Supreme
Court"), the country's highest legal body and the hearing is scheduled to
commence on November 29, 2017. A positive ruling by the Supreme Court to
uphold the Civil Court force majeure ruling would likely allow the Company to
apply to the Ministry for the 630 day extension of Zharkamys Contract.
Conversely, a decision by the Supreme Court to uphold the findings of the
Court of Appeal would likely result in the Zharkamys Contract reverting back
to the Ministry. The on-going court proceedings do not affect the Company's
production rights for the Shoba and Taskuduk oilfields which are each governed
by separate production contracts.

Credit Facility

During the first quarter of 2017 the Company established and received funds
from a USD 10.0 million secured non-revolving credit facility which bears
interest at 14% and matures on January 31, 2020 ("Credit Facility"). Interest
for the first year of the Credit Facility is due on January 31, 2018 followed
by eight payments of USD 1.25 million of principal plus interest due quarterly
in arrears commencing March 31, 2018. Condor also issued to the lender a
warrant certificate exercisable into one million common shares of Condor at
$2.35 per share on or before January 31, 2020. The loan proceeds are available
to fund capital expenditures related to drilling, infrastructure and workovers
at Poyraz Ridge and for general corporate purposes.

NON-GAAP FINANCIAL MEASURES

The Company refers to "operating netback" in this news release, a term with no
standardized meaning as prescribed by GAAP and which may not be comparable
with similar measures presented by other issuers. This additional information
should not be considered in isolation or as a substitute for measures prepared
in accordance with GAAP. Operating netback is calculated as crude oil sales
revenue less production costs, royalty expense and transportation and selling
expense on a dollar basis and divided by the sales volume for the period on a
per barrel basis. This non-GAAP measure is commonly used in the oil and gas
industry to assist in measuring operating performance against prior periods on
a comparable basis and has been presented in order to provide an additional
measure for analyzing the Company's crude oil sales on a per barrel basis and
ability to generate funds.

FORWARD-LOOKING STATEMENTS

Certain statements in this news release constitute forward-looking statements
under applicable securities legislation. Such statements are generally
identifiable by the terminology used, such as "anticipate'', "appear",
"believe'', "intend", "expect", "plan", "estimate", "budget'', "outlook'',
"scheduled", "may", "will", "should", "could", "would", "in the process of" or
other similar wording. Forward-looking information in this news release
includes, but is not limited to, information concerning: initial production
rates and the expected timing thereof; the timing and ability to commission
the Poyraz Ridge facility and pipeline and obtain the customary government
approvals to commence production; the ability of the drilled wells to become
producing wells; projections and timing with respect to crude oil and gas
production; expected markets and prices for future oil and gas sales; the
timing and ability to obtain various approvals for the Company's exploration
and development activities; the timing and ability to access oil and gas
pipelines and oil and gas domestic and export sales markets; anticipated
capital expenditures and cash flows; sources and availability of financing for
potential budgeting shortfalls; the timing and ability to obtain future
funding on favourable terms; general business strategies and objectives;
possible outcomes regarding the Zharkamys Contract including the possibility
that the term may be extended or, conversely, that it may revert back to the
Ministry; the timing and ability to obtain exploration and production contract
extensions; the potential for additional contractual work commitments; the
ability to meet and fund the contractual work commitments; the satisfaction of
the work commitments; the results of non-fulfillment of work commitments; the
expectations related to future general and administrative and other expenses;
projections relating to the adequacy of the Company's provision for taxes; the
timing and ability to collect VAT; expected rates of return; and treatment
under governmental regulatory regimes and tax laws.

By its very nature, such forward-looking information requires Condor to make
assumptions that may not materialize or that may not be accurate.
Forward-looking information is subject to known and unknown risks and
uncertainties and other factors, which may cause actual results, levels of
activity and achievements to differ materially from those expressed or implied
by such information. Such risks and uncertainties include, but are not limited
to: regulatory changes; the timing of regulatory approvals; the risk that
actual minimum work programs will exceed the initially estimated amounts; the
results of exploration and development drilling and related activities;
imprecision of reserves and resources estimates and ultimate recovery of
reserves; historical production and testing rates may not be indicative of
future production rates, capabilities or ultimate recovery; the historical
composition and quality of oil and gas may not be indicative of future
composition and quality; general economic, market and business conditions;
industry capacity; uncertainty related to marketing and transportation;
competitive action by other companies; fluctuations in oil and natural gas
prices; the effects of weather and climate conditions; fluctuation in interest
rates and foreign currency exchange rates; the ability of suppliers to meet
commitments; actions by governmental authorities, including increases in
taxes; decisions or approvals of administrative tribunals and the possibility
that government policies or laws may change or government approvals may be
delayed or withheld; changes in environmental and other regulations; risks
associated with oil and gas operations, both domestic and international;
international political events; and other factors, many of which are beyond
the control of Condor. Capital expenditures may be affected by cost pressures
associated with new capital projects, including labour and material supply,
project management, drilling rig rates and availability, and seismic costs.

These risk factors are discussed in greater detail in filings made by Condor
with Canadian securities regulatory authorities including the Company's Annual
Information Form, which may be accessed through the SEDAR website
(www.sedar.com).

Readers are cautioned that the foregoing list of important factors affecting
forward-looking information is not exhaustive. The forward-looking information
contained in this news release are made as of the date of this news release
and, except as required by applicable law, Condor does not undertake any
obligation to update publicly or to revise any of the included forward-looking
information, whether as a result of new information, future events or
otherwise. The forward-looking information contained in this news release is
expressly qualified by this cautionary statement.

ABBREVIATIONS

The following is a summary of abbreviations used in this news release:

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bopd Barrels of oil per day
MM Million
Q Quarter
scf Standard cubic feet
USD United States dollars
% Percent
/ Per

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The TSX does not accept responsibility for the adequacy or accuracy of this
news release.

- END RELEASE - 14/11/2017

For further information:

For further information, please contact:Don StreuPresident and CEOorSandy QuiltyVice President of Finance and CFO403-201-9694

COMPANY:FOR: CONDOR PETROLEUM INC.TSX Symbol: CPI

INDUSTRY: Energy and Utilities - Oil and GasRELEASE ID: 20171114CC007

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